Growing doubts about Nvidia’s AI dominance

“Nvidia has once again exceeded expectations, but the competitive landscape is changing as companies like Meta increasingly rely on AMD and major cloud providers invest more in their own chips,” said Jacob Bourne, analyst at eMarketer. “As a result, the focus is on the issues of whether the group can maintain its dominance and questions about the return on corporate investments are increasing.”

Richard Clode, portfolio manager at Janus Henderson Investors, added: “The debate is less about the excellent short-term results and more about the sustainability of AI investments given concerns about their scale, monetization and deteriorating cash flow.”

Market strategist Stephen Innes from asset manager SPI Asset says it is no longer enough to exceed expectations. Rather, the AI ​​cycle has already progressed so far that investors are increasingly asking themselves how long it will continue at this rapid pace.

Analyst Jochen Stanzl from Consorsbank pointed out the double-edged nature of Nvidia’s numbers: “Signs of faster AI expansion are no longer a reason for investors to fall into celebratory arias.” In addition, statements from Nvidia’s CFO Collette Kress about potentially greater pressure from Chinese competitors in the long term made people sit up and take notice.

“The demand for computing power is growing exponentially,” CEO Jensen Huang tried to reassure. With the next generation of processors, the group will expand its leading market position. And Nvidia remains the most valuable company in the world at $4.6 trillion.